Andrew Gwynne, MP for Denton and Reddish, has written to the Government and put in written questions looking for answers on frozen pensions.
This follows news that the Department for Work and Pensions has rejected a request from the Canadian Government for a reciprocal uprating agreement to end ‘frozen’ pensions for 125,000 UK pensioners in Canada.
Around 510,000 recipients of the UK state pension overseas are denied the right to annual payment increases because they now live in a country without a reciprocal uprating agreement with the UK. This leaves 4% of UK state pensioners without access to their full state pension as the value of their pension is ‘frozen’ at the rate it was when they left the UK, or first started claiming their state pension abroad. This means payments fall in real terms year on year.
The policy is arbitrary in nature due to a patchwork series of reciprocal uprating agreements: UK citizens in the US and the EU, for example, are entitled to their full state pension, whereas UK citizens in countries such as Canada, Australia and South Africa, and even in Overseas British Territories, on the other hand, are not. For years, the UK Government has justified this discrepancy by claiming that the Government will only uprate pensions where there is a legal requirement to do so – and through a reciprocal agreement.
The UK’s rejection of the reciprocal agreement with Canada undermines this argument.
Andrew Gwynne said:
“This is hugely disappointing news for thousands of British pensioners in Canada and completely undermines the UK Government’s own position on these frozen pensions.
“These pensioners deserve answers and that’s why I have written to the Work and Pensions Secretary.
“At the very least, she needs to explain what on earth the Government is thinking, but really she needs to go further and reopen the dialogue with the Canadian Government.”